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The operation was conducted at the behest of the FBI, which believes Dotcom - also known as Kim Schmitz - is the kingpin of an internet piracy ring.

Prosecutors have estimated the ring netted $175m by providing access to illegally copied music, movies and other copyrighted content before being shut down.

Dotcom's lawyers have contested the charges maintaining that the company only offered online storage.

The decision is a blow to the FBI's global anti-copyright campaign. The law enforcement agency is currently seeking the extradition of several alleged copyright infringers including British citizen Richard O'Dwyer.